Fabio Capello today brought a week of intense speculation to a clinical end, stripping John Terry of the England captaincy in an attempt to draw a line under an episode that threatened to derail England's World Cup campaign before it has begun.

Terry was said to be shocked and ­devastated following his short meeting with Capello and the Italian's assistant Franco Baldini but accepted the reasoning behind the decision. The possibility of further ­damaging revelations appearing over a weekend when Capello will be in Warsaw for the Euro 2012 qualifying draw is understood to have been a factor.

Terry trained with Chelsea today before being driven to Wembley to face Capello for the first time since reports of his alleged affair with the former girlfriend of his international team-mate Wayne Bridge emerged a week ago, after a super-injunction preventing their reporting was lifted.

"I fully respect Fabio Capello's decision. I will continue to give everything for England," said Terry, who will be available for selection for the Egypt friendly at Wembley on 3 March.

So, too, will Bridge, who is expected to return for Manchester City tomorrow against Hull City after two months out with injury. It is understood that, after rumours that he might be ready to retire from international football if Terry remained in the squad, Bridge is still keen to play international football and retains World Cup ambitions.

Despite a long week of debilitating speculation during which the impact of the affair on everything from England's World Cup chances to the Football Association's bid to host the 2018 tournament, when the end to Terry's reign as England captain came, it was sudden.

In a meeting lasting less than 20 minutes Fabio Capello and his right-hand man Franco Baldini asked Terry to explain ­himself before informing him that he would be relieved of the role for the good of the team.

"After much thought I have made the decision that it will be best for me to take the captaincy away from John Terry," said Capello, who replaced him immediately with the vice-captain, Rio Ferdinand, and moved the third choice, Steven Gerrard, up to the deputy's role.

"As a captain with the team John Terry has displayed extremely positive behaviour. However, I have to take into account other considerations and what is best for all of the England squad. What is best for all of the England team has inspired my choice."

The FA had been keen to stress that the decision would be Capello's alone and taken on footballing rather than moral grounds. Baldini's soundings from other members of the squad, from Bridge, from the managers of both players and from lawyers and the media about the likelihood of fresh revelations are likely to have played a major part. The possibilityof these further revelations is thought to have played a substantial part in Capello's thinking.

Even before the most recent run of bad publicity Terry was forced to distance himself from a mis-spelt, badly worded email touting marketing tie-in opportunities leading up to the World Cup and defend himself after allegations he had accepted £10,000 for a private tour of Chelsea's training ground in a deal mediated by a well-known ticket tout. Terry said the money went to charity.

This morning, as he was preparing to face Capello, he faced fresh newspaper allegations that an associate had offered to re-sell his Wembley executive box for a cash payment of £4,000. Terry said he was unaware of the offer and Paul Nicholls, one of his agents, said the idea had been rejected out of hand when it was put to him.

The Chelsea defender, who won 28 of his 58 caps as captain, will now have to line up alongside his replacement – who has appeared only nine times for Manchester United this season – in a constant reminder of his diminished status in the squad.

Because Capello had already named Ferdinand as his vice-captain and Gerrard as his third choice when he awarded Terry the captaincy after auditioning several contenders upon taking the job, the players were not faced with an awkward decision on whether to accept the role.

Senior FA executives are pleased that their strategy of leaving the decision entirely to Capello and Baldini appears to have borne fruit but will be concerned about the possibility of it now becoming open season on the private lives of footballers and the possibility of further skeletons tumbling from their closets.

In comparison with previous scandals that have escalated beyond their control, the relatively new FA hierarchy of the chairman, Lord Triesman, and chief executive, Ian Watmore, have so far successfully avoided turning a crisis into a drama. Terry did receive a modicum of support today from the England 2018 bid, which confirmed he will remain as a World Cup ambassador for as long as he is an England player, as its executives unveiled a new sponsorship deal with BT.

Indeed Andy Anson, chief executive of the FA-led bid, framed the recent controversy surrounding Terry in positive terms. "We're selling the passion of football in England and the fact that everyone is obsessed with football," he said.

"People around the world are staggered by the amount of press some of these incidents get in this country and it reflects that passion. We're building on that passion and it is very much part of our pitch in this bid. The whole England squad are ambassadors for our bid and they will continue to be. They have done an amazing job."

Shortly after Terry was relieved of the captaincy Vanessa Perroncel, Bridge's former girlfriend, issued a statement through her publicist, Max Clifford, in which she said she would not be selling her story.

Clifford dismissed speculation that Terry had bought her silence: "That [speculation] is natural, to be expected and totally untrue. It was the papers offering her deals, she was not soliciting any of them. She is keeping her options open and meeting with lawyers regarding some of the untrue and hurtful things that have been said about her."